Friday, September 30, 2005

The advent of internet, globalization, free marketing, and liberalization has turned the world into a small global village consequently destroying all trade barriers. The awareness that outsourcing can boost productivity sans forfeit of class has impelled MNC’s, in all segments, to endorse this loom. A good number of major IT companies do most of their business overseas and obviously want to have some of their employees in those markets. Lower wages in some countries are also a huge incentive to move operations, especially since high-speed communication removes many of the barriers to dealing with U.S.-based colleagues and customers. Therefore, numerous MNCs in USA, Europe, Australia, and Japan have initiated IPOs (International Procurement Organizations) in developing third world countries particlulary India, China, Mexico and Brazil. Offshore Outsourcing ensues largely in the IT sector, followed by medical transcription and other health care-related jobs, automotive spares/components, engineering segment, and business processing, accounting, advertising, , Human Resource Management and Development, , financial investment and consultancy, legal services, and network security.The theory of outsourcing is also technology- motivated anchored in the principle that one must outsource low-tech data entry jobs requiring more of manual labour and focus on central activities, exploration and advance of innovative gizmologies. While the proceeds generated from Offshoring be utilized for further expansion and technology innovation and specialization thus engendering fresh and superior employment openings.An account primed by McKinsey Global Institute for the US Chamber of Commerce has avowed that: "A US company earns on an average a net profit of $1.12 to $1.14 by outsourcing work for which it pays $1.0 abroad." It additionally acknowledged that by offshoring low paid jobs abroad, US capital, fiscal or intellectual, can be exploiedt to spawn more lucrative and superior revenue generating jobs. The report also affirmed that by outsourcing assignments to India and other developing countries, many US / European companies are also establishing new markets in such countries. Call centers so grounded in India or other developing countries are being fundamentally outfitted with US or European gizmos like Compaq / HP Computers, Microsoft software, Lucent phones and Carrier air conditioners.